Wall Street moves higher; Fed policy meeting on the horizon

  • In Business
  • 2019-06-17 14:32:34Z
  • By By Shreyashi Sanyal

By Shreyashi Sanyal

(Reuters) - U.S. stocks ticked higher on Monday, with the tech-heavy Nasdaq powering ahead, as investors awaited a pivotal Federal Reserve meeting for clues on the path ahead for interest rates.

The central bank is expected to leave borrowing costs unchanged at its two-day policy meeting starting Tuesday, but market expectations are for a rate cut as early as July.

The S&P 500 index has risen 5% so far this month on hopes of a rate cut in the face of weaker economic data and heightening global trade tensions, but that rally petered out in the past week.

"I think the focus will be on what the Fed sounds like in the meeting this week," said Scott Brown, chief economist at Raymond James in St. Petersburg, Florida.

"Jerome Powell has got to be very careful about what he says, and how he frames it because you don't want the market to panic if the Fed's going to be behind the curve."

The Fed's policy-setting committee is due to release its statement at 2 p.m. EDT (1800 GMT) on Wednesday, with Fed Chair Powell holding a press conference shortly after.

The Nasdaq Composite index rose, boosted by 1% to 3% gains in shares of marquee companies such Facebook Inc, Apple Inc, Amazon.com Inc, Microsoft Corp and Alphabet Inc.

At 10:01 a.m. ET, the Dow Jones Industrial Average was up 13.99 points, or 0.05%, at 26,103.60 and the S&P was up 5.82 points, or 0.20%, at 2,892.80. The Nasdaq was up 56.00 points, or 0.72%, at 7,852.66.

Investors also braced for the Group of 20 summit at the end of the month, which has fueled hopes of progress on resolving the prolonged trade war between the United States and China.

Capping the gains on the Dow index was the 3.48% drop in Dow Inc after brokerage BMO Capital Markets downgraded the chemicals maker's stock to "market perform" on rising macro uncertainty.

Banking stocks gained 0.16%, while the broader S&P 500 financial sector edged up 0.08%.

Shares of Walt Disney Co dropped 1.21% after a report that Imperial Capital had downgraded the entertainment conglomerate's shares to "in-line."

Array Biopharma Inc jumped nearly 57.79% after Pfizer Inc agreed to buy the drugmaker for $10.64 billion to beef up its cancer portfolio. Pfizer edged down.

Hard-disk drive maker Seagate Technology declined 1.15% following Susquehanna's price target cut on worse-than-expected memory pricing weakness.

Advancing issues outnumbered decliners by a 1.23-to-1 ratio on the NYSE and a 1.41-to-1 ratio on the Nasdaq.

The S&P index recorded 27 new 52-week highs and four new lows, while the Nasdaq recorded 29 new highs and 46 new lows.

(Reporting by Shreyashi Sanyal and Aparajita Saxena in Bengaluru; Editing by Sriraj Kalluvila)


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